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TMI Blog2011 (4) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... 5-4-2011 - Archana Wadhwa, P Babu, JJ. For Appellant: Shri Jigar Shah, Adv. For Respondent: Shri R Nagar, SDR Per: Archana Wadhwa: Being aggrieved with the order passed by Commissioner(Appeals), Revenue has filed the present appeal. 2. As per facts on record, the respondents are 100% EOU engaged in manufacture of bulk drugs and fine chemicals. The dispute in the present appeal relates to the respondent's liability to pay Service Tax in respect of banking and financial services received by them from a foreign country. 3. The Revenue conducted investigations and recorded the statements of various persons. During the course of investigation and from the statements recorded, it was revealed that the appellants have availed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and controls fixed by the Reserve Bank of India in relation to the issuance of FCCB. The appellants have paid the management fee of USD 6,50,000/- which in INR is equal to Rs.2,84,62,000/- to Rabo Bank International, Nederland, Singapore Branch on which they were liable to pay the Service Tax to the tune of Rs.29,03,124/-. A Show Cause Notice dt.29.5.08 was issued to the appellants which was adjudicated vide impugned order. The adjudicating authority confirmed the demand of Service Tax of Rs.29,03,124/- under Section 73(1) of Finance Act, 1994. He directed to pay the interest under Section 75 of Finance Act, 1994, and also imposed penalties under Section 76 and Section 77 of Finance Act, 1994." 4. Being aggrieved with the order of ori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... services. In other words, it is only after enactment of Section 66A that taxable services received from abroad by a person belonging to India are taxed in the hand of the Indian residents. In such case, the Indian recipient of taxable services is deemed to be the service provider. Before enactment of Section 66A, there was no such provision in the Finance Act, 1994 and therefore the respondents had no authority to levy Service Tax on the member of the petitioners association."Thus, in view of the above decision of Hon'ble Mumbai High Court, it becomes clear that reverse charge tax shift mechanism operating under Rule 2(1)(d)(iv) of the Service Tax Rules, 1994 read with Section 66A of Finance Act, 1994 is effective only from 18.4.06. Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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